News Feature
| May 7, 2014

Sun Pharma To Shut Down Detroit Manufacturing Plant

Sun Pharma plans to close its Detroit manufacturing plant Caraco Pharmaceuticals this summer, putting 178 jobs on the chopping block. The closure is part of U.S. manufacturing consolidation efforts, the India-based company announced Friday.

With the proper measures in place, Sun Pharma is confident there will not be a break in production for drugs currently being manufactured at Caraco. Manufacturing will be transferred to other facilities as to not incur any drug shortages.

Impacted employees will receive compensation under their severance packages, along with support services like out-placement assistance or other mutually consented arrangements.

Caraco was founded in Detroit in 1984 and acquired by Sun Pharma in 1997. The plant was primarily responsible for manufacturing medicines for diabetes, epilepsy, heart treatment, pain, and other ailments.

In 2007, Caraco manufactured 35 generic and private-label drugs, employed 455 people, and had plans to create more than 600 new jobs. However, in 2009 the FDA halted production when Federal Marshalls seized $20 million worth of unsold drugs because of the company’s “failure to meet federal drug manufacturing standards,” according to the Detroit Free Press. The agency cleared Caraco to resume production of three drug products in August 2012.

This plant closure, though part of an overarching effort to streamline the company’s U.S. manufacturing operations, is riding on the coat tails of the FDA’s ban on Sun Pharma’s exports into the U.S. in March.

The FDA issued a 483 observance to the company last November, when inspectors noted the presence of rodent traps, garbage piles surrounding the building, and what they called an “uncleanable” laboratory. It was also observed that workers lied about test data and “deleted undesirable results,” the Live Mint reported.

News of this latest ban adds to the growing scrutiny of India’ generics companies, as Sun Pharma is joining 20 other manufacturers that the FDA has added to its import alert list since early 2013.

Industry leaders in India blame “weak local regulatory oversight and a lax approach to quality control by some drug makers in a rush to tap growing global demand for generics,” according to Reuters.